§ 23. Mr. H. Hyndasked the Minister of Transport whether he is aware that some of the shipping companies now receiving subsidies from public funds are paying dividends of 15 per cent.; and whether he will take steps to bring the subsidies to an end.
§ Mr. BarnesThe subsidy is for the purpose of keeping in operation certain coastwise liner services and is based on the cost of providing them. The amount of and necessity for a subsidy are kept under review. The provision of services qualifying for the subsidy is only a small fraction of the business activities of the companies to which my hon. Friend refers.
§ Mr. HyndIs there any necessity for the taxpayer to subsidise a firm which is paying a dividend of 15 per cent. plus 3 per cent. tax free capital bonus? It is scandalous.
§ Mr. BarnesMy hon. Friend has merely quoted the dividend distribution of the firm. In dealing with coastwise traffic we cannot differentiate according to the prosperity or range of activity of different companies. We have to consider the services for which the subsidy is granted.
§ Mr. GallacherCan we take it that in issuing subsidies to these companies there is no means test of any kind? Do they get the subsidy whether they are prosperous or not?
§ Mr. BarnesThey get the subsidy on the basis of performance.